Lincoln Joint Stock Land Bank of Lincoln v. Williams
| Decision Date | 14 February 1933 |
| Docket Number | 41595 |
| Citation | 246 N.W. 841,216 Iowa 659 |
| Parties | LINCOLN JOINT STOCK LAND BANK of Lincoln et al., Appellees, v. MARSHALL J. WILLIAMS et al., Appellants; B. A. GRONSTAL, Intervener, Appellant |
| Court | Iowa Supreme Court |
REHEARING DENIED JUNE 23, 1933.
Appeal from Pottawattamie District Court.--K. R. COOK, Judge.
This is an action in equity upon a promissory note and foreclosure of real estate mortgage securing the same. The defense urged is that plaintiff cannot maintain the suit and is not entitled to recover in the case, for the reason that plaintiff split his cause of action and exhausted his remedy in a prior foreclosure suit involving past-due installments only, in which prior case judgment was entered for past-due installments, and all of the mortgaged property sold under special execution in satisfaction of such prior judgment. There was judgment and decree for plaintiff in the case at bar, and defendants appeal.
Affirmed.
Wright & Baldwin, George S. Wright, Addison G. Kistle and Paul E Roadifer, for appellants.
Frank E. Northrop and Tinley, Mitchell, Ross & Mitchell, for appellees.
The record, which is all documentary, discloses the following situation:
On February 25, 1927, the defendants Marshall J. Williams and Gertrude L. Williams executed and delivered to the Lincoln Joint Stock Land Bank of Lincoln, Nebraska, their promissory note for $ 37,000, with interest at 5 1/4 per cent per annum, payable in semi-annual installments as follows: $ 1,111.08 on the 1st day of August, 1927, and a like sum every six months thereafter until eighty such semi-annual payments were made; also providing for interest at 8 per cent on the defaulted payments. The said promissory note was secured by a mortgage upon approximately 640 acres of land situated in Pottawattamie county, Iowa, which mortgage was duly recorded in Pottawattamie county on the 28th day of February, 1927; the said mortgage containing covenants requiring the mortgagors to pay all taxes and assessments levied against the land, and to keep the buildings thereon insured; and, in case of failure to do so, providing that said mortgagee may pay such taxes and assessments and effect such insurance; and the amounts paid therefor, with 8 per cent interest thereon from date of payment, "shall be secured by this mortgage and shall be collectible with, as part of, and in the same manner as the principal sum hereby secured." The mortgage also pledged the rents and profits of the real estate therein described, and provided for the appointment of a receiver in event of foreclosure. The mortgage contains further covenants providing that, in case of default, the entire debt may be declared due and payable, and that the mortgagee may proceed to foreclose said mortgage, "or mortgagee may foreclose only as to the sum past due without injury to this mortgage or the displacement or impairment of the lien thereof."
On May 15, 1930, the plaintiff, the Lincoln Joint Stock Land Bank of Lincoln, commenced in the district court of Pottawattamie county at Council Bluffs, an action to foreclose the mortgage mentioned for delinquent installment and taxes, said case being known as equity No. 29272, reciting in its petition that installment No. 7, due February 1, 1930, in the sum of $ 1,111.08, was past due and delinquent; that the 1928 assessment of taxes was not paid by the mortgagors, and on November, 1929, was paid by the plaintiff in the sum of $ 1,111.34; that the first one-half of the 1929 taxes became delinquent and were paid by the plaintiff on May 13, 1930, in the sum of $ 594.40; and plaintiff asked judgment for the several amounts so in default with interest, and small items for continuing abstract, all in the total sum of $ 2,842.31, and the plaintiff asks in its petition that such total amount be established and confirmed as a lien on the mortgaged premises from the date of the mortgage:
"Subject only to the lien of the plaintiff for the unpaid principal and interest and nondelinquent installments of said note; that the mortgage lien for the delinquencies as shown in this petition be foreclosed and that a special execution issue for the sale of the mortgaged premises; that the said sale be so made that the same shall not impair plaintiff's right to foreclose its mortgage in case a subsequent installment may become due and in default, and that it be so decreed by the court."
And asking further that the court provide by decree that any redemption of the premises under such sale "shall be subject to the unpaid balance of plaintiff's mortgage."
Prior to the filing of the above-mentioned petition and on the 12th day of May, 1930, an original notice in said entitled case was served upon the defendants, reciting the claims and prayer of plaintiff in said case, and alleging further:
"Foreclosure of said mortgage is asked as to the amounts shown due as above with interest and costs, and such foreclosure will be without prejudice to plaintiff's right to foreclose its mortgage for subsequent delinquencies, and said foreclosure will be without injury or impairment to plaintiff's lien of said mortgage, for the unpaid principal and non-delinquent installments, which unpaid principal was on February 1, 1930, the sum of $ 35,940.72."
On the 31st day of July, 1930, the defendants having defaulted, judgment and decree was entered against them for the amount claimed by plaintiff, $ 2,866.06, with interest and costs, and establishing the lien of plaintiff's mortgage, and ordering that a special execution issue to satisfy such judgment.
"(Said sale to be made subject also to the mortgage lien of the Plaintiff for the amount still due and unpaid and not herein foreclosed, which balance on February 1, 1930, was the sum of $ 35,940.72 * * * That any redemption from said sale shall redeem said real estate subject to the unpaid balance of plaintiff's mortgage.) * * *"
The decree further provides that, if a sheriff's deed issue to the purchaser under such foreclosure sale,
A special execution was issued upon said judgment and decree, containing the following provision:
"(Said sale to be made subject also to the mortgage lien of plaintiff for the amount still due and unpaid and not herein foreclosed, which balance on February 1, 1930, was the sum of $ 35,940.72.)"
The mortgaged property was levied upon under said special execution and sold by the sheriff on the 3d day of September, 1930. The return of the sheriff on the said execution included the same paragraph as last above quoted, as did the certificate of sale issued to the purchaser, the Lincoln Joint Stock Land Bank.
That on the 2d day of September, 1931, the last day of the period of redemption from said foreclosure sale, the defendants, Williams, executed to one B. A. Gronstal a conveyance of the real estate involved for the recited consideration of $ 100; said conveyance being a general warranty deed, but containing the following:
"Except as to legal and valid liens of record, none of which the grantee either assumes or agrees to pay."
On the same date of the said conveyance the grantee named therein, B. A. Gronstal, as the owner of the real estate involved, redeemed from the execution sale by paying to the clerk of court $ 4,391.36, and the sheriff's certificate of sale with endorsements of assignment to F. W. Van Druff was surrendered and canceled.
The foregoing statement in detail as to the record facts in the first foreclosure action is lengthy, but we deem it necessary for an intelligent understanding of the issue here presented.
On the 11th day of March, 1931, the plaintiff filed its petition in the case at bar alleging the execution by the defendants on the 25th day of February, 1927, of the principal note of $ 37,000 and the mortgage securing the same as detailed in the foregoing preliminary statement, and alleging that installments Nos. 8 and 9, due August 1, 1930, and February 1, 1931, each for $ 1,111.08, were past due and delinquent, and that an installment of delinquent taxes amounting to $ 582.74 and paid by plaintiff on September 12, 1930, remained delinquent and unpaid by the defendants, and that under the provisions of said mortgage the said plaintiff declared the entire amount secured by its note and mortgage due and payable, and asked judgment against the defendants for the aggregate sum of $ 38,701.06, reciting that such amount was due and owing the plaintiff, in addition to the amount found to be due it in the decree entered in the former action, and praying that its mortgage be foreclosed, and special execution issue for the sale of the property therein described. F. W. Van Druff, having purchased the note and mortgage involved, and having obtained an assignment of the cause of action stated in plaintiff's petition, was by an order of court entered on the 3d day of June, 1931, substituted as plaintiff in said action.
On September 12, 1931, Marshall J. Williams, Gertrude L Williams, and Clifford Williams, defendants, filed their amended and substituted answer, and B. A. Gronstal, intervener, joined therein and adopted such answer as his amended and substituted petition of intervention. In said pleading the...
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